Latasha Ringo and others recruited taxpayers into the scheme, then created W-2 forms claiming fake employment and tax withholdings, according to a statement from the U.S. attorney's office. The taxpayers then submitted the falsified returns using their actual names and Social Security numbers using authorized commercial electronic filing services.

Ringo was arraigned on charges of conspiracy to file false claims Tuesday and pleaded not guilty. She will appear next on Dec. 5.

If convicted, Ringo could face a maximum sentence of up to 10 years in prison and a fine of $250,000.